Data-Driven Results Influence Federal Budget Cuts

As agencies are forced to do more with less, they'll need a clear vision, the right tools and an eye toward innovating, says former GAO leader and Deloitte director.

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Sequestration has hit the federal government hard. Deep across-the-board cuts, once thought to be a looming threat, are increasingly expected to impact federal programs through 2021. For agency program leaders and IT executives who support them, finding a silver lining in the nearer-term outlook is especially challenging with spending cuts estimated to grow from $85 billion to $109 billion between fiscal years 2013 and 2014.

But positive outcomes are possible as long as agencies have a clear vision and the right frameworks, and take advantage of technology and other tools, said a former chief operations officer of the U.S. General Accounting Office (GAO) who now works for Deloitte Services.

"As we move from fiscal year 2013 to 2014, spending will be at an all-time low. This could impact competitiveness and innovation. However, there's also an opportunity for the government to become more efficient and to do things differently," said Ira Goldstein, director of Deloitte Services, during a July 30 webcast that focused on how recent legislation is forcing the government to do more with less.

Among the tools he suggested agencies will need to capitalize on more effectively are a combination of data analysis, technology and innovation, people and leadership.

The American Taxpayer Relief Act of 2012 and Budget Control Act of 2011 have triggered automatic spending cuts that are projected to total $1.2 trillion over a nine-year period. Across-the-board decreases, starting in fiscal year 2013 and ending in 2021, include $550 billion in defense cuts, $510 billion in non-defense cuts, $560 billion in Medicare cuts, and $95 billion in other mandatory spending cuts.

Goldstein said agencies must focus on strategies that can be supported by evidence and available information. Technologies that can pull together and analyze existing data streams will be critical in bringing focus to agencies, he added.

Legislation requires agencies to build strong accountability frameworks so that resources are spent on what's working, versus initiatives that aren't working, he said. That will put greater emphasis on using data collection and analysis tools that agencies can use to measure progress towards goals.

He cited the Virginia Performs scorecard as an example. It provides a performance leadership and accountability system that shows how the state is doing in various areas. Performance data should be used to refresh strategies in real time, he stressed.

That's more than a recommendation: The Office of Management and Budget (OMB) issued a memo on July 26 to heads of departments and agencies, offering guidance for 2015 budget submissions. The memo -- from Sylvia Burwell, OMB director, Cecilia Munoz, director of the Domestic Policy Council, John Holdren, director of the Office of Science and Technology Policy, and Alan Krueger, chairman of the Council of Economic Advisers -- urged agencies to use evidence about what works and innovation to improve government performance. A portion of the document focused specifically on harnessing data to improve results.

How well is data being used is an important question agencies should be asking themselves, said Jitinder Kohli, director of Deloitte Consulting. "There is a desire to create data-driven results and make performance-based decisions," Kohli said. "The signs are there that agencies are feeling greater pressure than in the past."